Startup for beginners - 5 Key guidelines for to validate your idea

There is no doubt: in the past 10 years startups and all the ecosystem revolving around them have been changing the world economy, while becoming one of the main innovation and GDP development drivers.

 Everyday more people with good ideas approach to this easier way to make business, and this allows potentially everyone to start from an idea and to end up with a useful service.

Before starting, let me first specify that this article aims to guide startups beginners or all of those are approaching to this world or… are just simply interested in it, which means that  if are already an experienced startuper this video might not be the perfect fit for you, so I suggest you to follow my Social Media channels for technical and expert-level new upcoming videos.

  You cal also find, visually explained, the content of this article in this video that I have created for my LinkedIn network:

Number 1. Define your business idea.

It requires the biggest share of effort and a deep understanding of the concept in se. Before implementing your go-to market strategy, the most important aspect of the project in its early stage is that you need to know exactly what you are going to propose to market.

Frequently can happen that we got illuminated by a brilliant idea, which seems a unicorn intuition in the moment, but when it comes to business Implementation it turns to a conventional product or worst...it doesn't even get implemented.

If you hold expertise on the business domain which your startup means to be implemented, you are in advantage to define your product and your brand. If you don't, don’t worry: you just need to gather information from Internet, experts, consultants, books, case histories and all the other sources. Here you will understand how worthy is the relevant knowledge.

However, regardless your expertise above the business domain of your startup, you need to deeply assess your potential product and define all its high-level aspects. Using a Canvas model could be extremely helpful and guiding during this process. I will make one fully dedicate video about the Canvas business model.

 Number 2. Market Research

One of the key business feasibility study is the market research, which in my case involves in : market volume, penetration Rates, Key Trends , high level competition analysis etc.

 Basically, all you have to do is gather information from Google, spending hours in collecting all the relevant data and to organise them into a spreadsheet.

 Make sure your numbers are appetible to the investor’s eyes, your idea shall represent a unique an huge profit opportunity.

Number 3. Write the Business Plan

Once defined the business purpose of your startup, you will enter in the depth of you work: the business plan. There are a lot of school of thinking regarding the composition of the business plan. In this video I will just provide my point of view, based on my previous tech experience in Europe and in the GCC Region.

What is usually called “BP” is more specifically a Business Pack or Business Case, which means a collection of different documents, analysis and computation which state the business purpose of your startup and accurately describe how the business growth will occur and which resources will be used. Some founders use to add the Strategy plan in the business case, I highly don’t recommend that, for security and confidentiality reasons.

Your final pack shall include at least: market analysis, competition matrixes, SWOT analysis, product definition, mission & vision, Technical details (technology), high-level pricing information, financial statements (income statement, balance sheet etc), revenue predictions and the list of relevant KPIs. A final section should be added in order to display the key achievements in the relevant time-frames. These are extremely important when it comes to raise funds.

 Number 4. Conduct a full Competitor & Pricing Analysis

 Prior to really complete your Business Pack and at the same time to write the strategy plan down, you need to assess the pricing aspect of your competitors. Defining your target customers, considering customer’s behavior, age groups, culture and pro-capita GDP is a good starting point. Behind the numbers and the fees that you choose to ideally charge to your target customers, there should be a clear vision. Yes, make sure that your numbers sustain your growth, fuel your business traction and make your revenue hyper-green but at the same time understand which will be your loyal customer base. This aspect is relevant as the chosen pricing strategy will automatically select your future loyal customer base.

Finally Number 5. Write the Investor Pitch

If you don’t possess the capital power, you need to raise funds and… to raise funds, you need to pitch investors willing to invest money in your project. To do that, a successful Investor Pitch or Pitch Deck shall be created.

It doesn’t matter the form, it could be a PP presentation, a textual document, a printed brochure or both. You need to represent the idea in a few space and convince your potential investors that they are gonna put their money into something that will produce huge returns.

 My personal suggestion on that is to stay focused on the key information which investors might be interested in and to display your idea as much visual as you can. If you want to impress them, you can eventually print a brochure as well.

 By the way, I will make another video in which I will discuss about how to create a killer investor pitch, but at the moment just take into consideration these following advices:

-      Your IP should not exceed 15 pages: VCs and AIs use to read thousands of Ips every year. Think about how you can impress them in few words and practice the presentation until also your grandma can actually understand what you are talking about. You have between 5 and 7 minutes to impress your potential investors

-      Stay high level on the strategy and be precise on the financial numbers. At the end of the day, Investors are putting their money expecting a potential return

-      The communication is fundamental. Differentiating your approach according to different type of investors is essential, however there is a common formula which can be used as base. Just follow this algorithm: Describe your product as you were talking about it in a promotion spot, then do the same imagining to have a purely technical audience as interlocutor. Your IP’s final communication style shall be a balanced mix of the first two versions. Put yourself at the place of your investor. How would you react? What would you like to hear? What would you be more interested in? Ask yourself questions and, importantly, give yourself answers before the crucial meeting will take place.